UPDATE 1-Russian farming group Rusagro bets on sugar as prices rise

MOSCOW Nov 23 (Reuters) - Russian farming conglomerate
Rusagro said it plans to sign a deal this week to buy
the debt and some equity of rival Razgulay as part of
a plan to expand its sugar business at a time of rising prices.

Raw sugar futures are trading near a 10-month high
thanks to lower-than-expected output in No. 2 grower India and
as rains hampered the cane crush in Brazil's main region,
fuelling prices on the import-dependent Russian market.

Rusagro had earlier agreed with Razgulay's creditor VEB to
take over around 34 billion roubles ($519 million) worth of debt
and 20 percent of shares of the indebted sugar and grain
producer.

Detailing the plan, Maxim Basov, Rusagro chief executive
officer, said on Monday Rusagro expected to get a 34 billion
rouble, 13-year loan from VEB at "a very low interest rate" this
week to fund the acquisition.

Later on, Rusagro expects Razgulay to put its assets up for
sale through auctions in which Rusagro plans to bid for several
sugar mills and agricultural land, Basov added.

"One scenario - we will get a lot of cash but won't buy
assets, the other scenario - we will get assets and cash... We
hope that we will be able to buy the assets ... in the first
half of next year," he told analysts on a conference call.

He said next year's capital expenditures would likely rise
to around 15 billion roubles from 10 billion roubles in 2015
partly because Rusagro planned to invest in the Razgulay mills
which he said were "very under-invested."
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